Why Woolworths liquor business BWS is employing thousands of new chief executives
Monday, December 12, 2016/
Executives at liquor operation BWS are taking a step back and putting store staff in charge of realising the strategic direction of the business after its owner, troubled supermarket giant Woolworths, flagged beverages as a key part of the company’s return to strength.
In August Woolworths posted a $1.23 billion loss in a year that senior management described as disappointing and extremely challenging. At the company’s annual general meeting in November, chief executive Brad Banducci highlighted the company’s Endeavour Drinks Group, which includes BWS and Dan Murphy’s, as one of the only bright spots in a tumultuous year. The two businesses secured a 3% rise in earnings before interest and tax (EBIT) in the 2016 financial year, to $7.6 billion.
Woolworths has amped up the presence of BWS over the past year, closing 24 stores but adding another 56 to its 1300-strong network as the company looks to cement dominance in the area, and the growth plan has involved a rethink on how head office and store managers interact to build customer loyalty in the liquor space.
BWS chief executive Guy Brent told SmartCompany “only way you can do that is by empowering the local team”.
Over the past few months BWS management have changed the language and approach they use when training and discussing strategy with front-line retail workers, including renaming store managers “Store CEOs”. Some of the business’s online training resources have also been scrapped in order to focus more on in-store role playing and workshopping so that the business can shape itself into a friendly local bottle-o for more customers.
“A lot of retail businesses are trying to be more local now—we see customers wanting a more local village experience,” Brent says.
“Liquor is a pretty difficult category to shop, and we need to help our customers navigate that environment.”
With a goal to cement BWS’s reputation as a convenient, community-focused brand for shoppers that want some expertise when buying alcohol but might not know enough themselves, Brent says the language around head office has been changed as well.
“We call ourselves the store support team—we don’t use words like national and head office. Our job is to support the stores,” he says.
When it comes to building product knowledge across a range of lines, Brent says the approach has been “getting people passionate about a few products in each category and be really passionate about them”.
“Most people just want to be given a tip or a trick, which is something like ‘this chardonnay was voted one of the top 10 in the world recently’,” Brent says.
There are also plans for a more sophisticated product portal, with a recent relaunch of the consumer-facing BWS website and plans for in-store iPads for staff that can be referred to in instances where customers ask for recommendations on a particular product.
The community vibe extends to the brand’s relationship with smaller craft brewers in each region, with Brent observing BWS stores must walk the walk on local products if they’re going to be considered community-centric. This has led to the hiring of “Store CEOs” that have a passion for local brewers in their area that BWS can build relationships with.
“That’s when that partnership works best – when we’ve got that local relationship. The brewers will come in and do tasting in store and educate on their products,” Brent says.
At the 2016 Woolworths annual general meeting, management were keen to point out that customer, staff and supplier satisfaction with its brands had increased over the past 12 months, despite this coming off a “low base”, particularly on the supplier side.
Liquor forms a key part of the company’s approach to the year ahead. Brent says the approach to individual store empowerment is the best way to manage growth across the 1300-store network, and customers have been more than happy to jump into role plays and give feedback to store staff on the ground.
“Real customers actually really loved being engaged and being asked for their view,” he says.
“Retail is actually a really simple business, but providing a consistent customer experience is a real challenge.”